The loan, plus interest and fees, is due on your next payday and is withdrawn automatically from your bank account. If a loan is defaulted, the lender can charge up to a maximum of 30 per cent per annum on the loan principle and up to $50.00 for a NSF cheque or if a pre-authorized debit is dishonoured.

“Sometimes people don’t have a lot of options when it comes to borrowing money,” says Cory Peters, the consumer credit division director for the Financial and Consumer Affairs Authority of Saskatchewan.

“We want to make sure that people are aware of the fees and re-payment timeframes that are associated with payday loans.”

The loan, plus interest and fees, is due on your next payday and is withdrawn automatically from your bank account. If a loan is defaulted, the lender can charge up to a maximum of 30 per cent per annum on the loan principle and up to $50.00 for a NSF cheque or if a pre-authorized debit is dishonoured.

“Sometimes people don’t have a lot of options when it comes to borrowing money,” says Cory Peters, the consumer credit division director for the Financial and Consumer Affairs Authority of Saskatchewan.

“We want to make sure that people are aware of the fees and re-payment timeframes that are associated with payday loans.”

But it could be just the tip of the iceberg, says Financial Ombudsman Service

Complaints made against the payday lending industry to the Financial Ombudsman have doubled in the past year, according to the watchdog.

But the ombudsman also expressed puzzlement over the relatively small number of complaints made about the industry.

As Patrick Collinson of the Guardian has shown, a total of 399,939 people complained about payment protection insurance last year, while complaints for payday loans was a fraction of that at 794.

The watchdog said that many consumers were unaware they could make a complaint, and that lenders themselves – small firms as well as big ones – are doing nothing to highlight such services.

Complaints about payday lending are on the rise, and have been for some time. This time last year the industry was exposed by Citizens Advice as being “out of control”, with lenders frequently selling loans to people aged 18 and under, people with severe mental health difficulties and people who were drunk when they took on the debt.

At around the same time in 2013, complaints made to the Financial Ombudsman Service about the industry shot up 83 per cent – the third highest rise of any sector with the exception of the home credit industry (139 per cent) and payment protection insurance (PPI – 140 per cent).

Indeed, Citizens Advice found that many more people had cause to complain to the service. In its in-depth analysis of 665 payday loan cases, reported to its consumer service between 1 January and 30 June 2013, the charity found that at least 76 per cent of borrowers could have grounds for an official complaint to the Financial Ombudsman.

Those grounds included the 1 in 5 possible cases of fraud – where a person was chased for a loan they hadn’t taken out, the third of instances where money was withdrawn from a borrower’s account without an advance warning (potentially leaving them in a very precarious financial situation if they have other outgoings), harassment (including fake letters by lawyers, something we now know was practiced by Wonga), and the 1 in 10 loans that have been deemed unfair treatment of people in financial difficulties.

So clearly there should be many more complaints made about the industry than there currently are, even though that number has more than doubled. So what is happening?

The previously mentioned Patrick Collinson wonders whether it is because complaining is a middle-income, middle-aged response, and that those customers who are taking out payday loans are not au fait with using such services as the Financial Ombudsman.

There is some truth in this. With relatively little interaction with means to settle financial discrepancies, it is easy to see why many consumers would choose to find their own ways out of such problems.

However the industry those consumers are up against is experienced in pushing more loans, rather than responding to their efforts of financial resilience.

At a meeting recently I was able to see the volume of promotional emails one payday loan borrower received after falling on hard times with debt. In a six-month period, rather than assisting with help, or leaving the borrower be, the company sent the person dozens of emails offering larger and more expensive loans.

Then there is the shame. Many consumers don’t seek the help they need because of the shame associated with debt.

And yet the shame, if there is any, should be squarely leveled on the companies themselves who so often lend money irresponsibly and with impunity.

Charities like Citizens Advice and StepChange have stepped up to the challenge and advocated on behalf of greater complaining for the wrongs of payday lending. Trades Unions like Unite the Union and Unison have done the same. Civil society corrections to predatory capitalist ills.

Consumers must not let these companies get away with it.

Carl Packman is a contributing editor to Left Foot Forward and the author of Loansharks: The Rise and Rise of Payday Lending

The subsidiary, HSBC Finance Corp, also said it agreed to sell its loan servicing facility and related assets in London, Kentucky to Springleaf Finance Inc.

The total consideration to be paid by SpringCastle and its parent, Springleaf, is $3.2 billion in cash.

“These agreements accelerate the run-off of the legacy consumer mortgage and lending business and are a continuation of HSBC (LSE: HSBA.L – news) ‘s strategy to reposition its U.S. operations and focus on the core businesses supporting our aim to be the world’s leading international bank,” Patrick Burke, CEO, HSBC Finance Corp said in a statement.

Payday loans are the single most controversial financial product on the market today. High interest rates and various other issues have created a huge amount of bad press for the industry and there are a lot of vulnerable people using the services every month.

One might expect that a search on Google for “payday loans” would bring up some reputable lenders and comparison websites but this is certainly not the case. Last week I pointed out to Matt Cutts that there were two irrelevant hacked sites ranking first and second for this keyword. Hacked sites have been ranking since at least the middle of May.

Link Spam

Google has done more in the past few months to catch link spam than ever before but the algorithms they are using appear to be only good at penalising sites after the links have worked rather than before the site gets to the top. This is a great deterrent for legitimate businesses who probably want to get to the top and stay there but if you are a spam site (or somebody using a hacked site to rank) and just want to rank for a few weeks before moving onto another domain link spam is still a great way to get rankings.

I honestly don’t understand how Google is unable to algorithmically spot either hacked sites or spam sites that suddenly generate thousands of links and start ranking for a major keyword (the “payday loans” keyword probably sends several thousand visits per day to the top ranking sites).

Compare something like “payday loans” to the other financial search results such as insurance, loans and mortgages and there is a world of difference. Google is perfectly able to surface reputable lenders and insurers for those search results so why is payday loans such a tough keyword?

Penalties

The chart below shows the Searchmetrics visibility for a legitimate lender who looks like they have suffered some kind of filter or penalty and 3 other sites (the red one is a hacked site) who have come from nowhere to start ranking for these keywords. Surely Google should be able to spot this sort of thing? Why penalise one site and then allow other sites with worse link profiles to rank?

Patrick Altoft is Director of Search at Branded3 and has worked in the SEO industry for over 8 years. With experience across some of the worlds largest brands as well as startup businesses Patrick is well known in the industry and speaks regularly at the major SEO conferences and events.